MARKET CANNIBALIZATION
Reduction in sales volume or market share of a company, caused by a negative impact made by a new product the same company introduced. Also called corporate cannibalism, the new product "eats" up the demand and sale of an old product. Thus, the sales volume and market share of the older product went down. Another instance of market cannibalization (or cannibalization strategy) is when a new product obtrude on the existing market for an older commodity, rather than developing the market base of the firm. This new product attracts the company’s present market, leading to decreased sales and market share of the old product.
Also called cannibalization strategy.
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